Earnings Update: NanoXplore Inc. (TSE:GRA) Just Reported And Analysts Are Trimming Their Forecasts

The investors in NanoXplore Inc.'s (TSE:GRA) will be rubbing their hands together with glee today, after the share price leapt 24% to CA$1.70 in the week following its annual results. The results look positive overall; while revenues of CA$117m were in line with analyst predictions, statutory losses were 6.7% smaller than expected, with NanoXplore losing CA$0.07 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on NanoXplore after the latest results.

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Following the latest results, NanoXplore's four analysts are now forecasting revenues of CA$137.6m in 2027. This would be a decent 17% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 39% to CA$0.04. Before this latest report, the consensus had been expecting revenues of CA$148.6m and CA$0.03 per share in losses. So it's pretty clear the analysts have mixed opinions on NanoXplore after this update; revenues were downgraded and per-share losses expected to increase.

Check out our latest analysis for NanoXplore

The consensus price target fell 8.8% to CA$2.81, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on NanoXplore, with the most bullish analyst valuing it at CA$4.60 and the most bearish at CA$1.75 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that NanoXplore's rate of growth is expected to accelerate meaningfully, with the forecast 17% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 9.0% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 0.5% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect NanoXplore to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. They also downgraded NanoXplore's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for NanoXplore going out to 2029, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with NanoXplore .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.